Tuesday, September 30, 2014

Ignorance of Income Inequality is Damaging to our Society

Three years ago the Occupy Wall Street movement got
America’s attention with the cry of “We are the 99%.” Income inequality was put
under a spotlight for a time. But how far did the understanding penetrate?
Unfortunately, not very far.

First, in a recent poll the average American thought CEOs
made 30 times the wage of their employees, which hasn’t been true for 50 years.
Today the figure is ten times as much—over 300 times.

Second, most
people are completely unaware of the extent of wealth inequality, which is
much worse than income inequality. The wealthiest 20% in the U.S. own about 84% of the wealth.
Think about that for a moment: only 16% of wealth is left for over three-quarters of the population. When
you get to the bottom half of the
population, those 155 million people own only about 2% of the total wealth.

To see an illustration of the income and wealth inequality
in the United States, watch this episode
of a TV show I did with Arthur Hancock in 2010.

The chart above, created by Pavlina Tcherneva, an economics professor at Bard College, vividly
shows one of the contributors to the rise of income inequality in the last few
decades. The graph portrays the distribution of national income growth during
economic expansions since WWII. The blue represents the bottom 90%, the red the top 10%. In the last thirty years all the gains have
gone to the wealthy, in fact, in the latest expansion most Americans have been
losers—the truth is most of us don’t even realize we’re in an expansion, the
Great Recession hasn’t ended for us yet.

So how can people be unaware of this development [massive income
inequality], or at least unaware of its scale? The main answer, I’d suggest, is
that the truly rich are so removed from ordinary people’s lives that we never
see what they have. We may notice, and feel aggrieved about, college kids
driving luxury cars; but we don’t see private equity managers commuting by
helicopter to their immense mansions in the Hamptons. The commanding heights of
our economy are invisible because they’re lost in the clouds…

Does the invisibility of the very rich matter? Politically, it
matters a lot. Pundits sometimes wonder why American voters don’t care more
about inequality; part of the answer is that they don’t realize how extreme it
is. And defenders of the superrich take advantage of that ignorance. When the
Heritage Foundation tells us that the top 10 percent of filers are cruelly
burdened, because they pay 68 percent of income taxes, it’s hoping that
you won’t notice that word “income” — other taxes, such as the payroll tax, are
far less progressive. But it’s also hoping you don’t know that the top 10
percent receive almost half of all income and own 75
percent of the nation’s wealth, which makes their burden seem a lot less
disproportionate…

Today’s political balance rests on a foundation of
ignorance, in which the public has no idea what our society is really like.

And the wealthy, in control of the media and the government,
have a vested interest in keeping us ignorant.

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About Me

I'm a philosopher, writer, videographer, and entrepreneur. In 2013 I've released a new book, "We Are ALL Innocent by Reason of Insanity." I'm the co-author with my husband Arthur Hancock of "The Game of God: Recovering Your True Identity.